There are some companies listed on the ASX that have publicly been through a tough time.
For some, it's entirely their own fault and for others, external forces have conspired against them. For most, there's a bit of both.
In any case, those businesses with a battered image are worth looking at for investment. After all, shares are at their cheapest when everyone hates the company.
But to sort out the value traps from the actual gold, a couple of experts recently stuck their necks out:
Dividend will get fatter
Among the four big banks, Westpac Banking Corp (ASX: WBC) has not been one of the favoured ones among investors.
It has lurched from one scandal to another in recent years, having to deal with the Royal Commission, money laundering accusations, and a string of court actions from the corporate watchdog last year.
Westpac's share price has actually lost more than a quarter over the past five years.
And now with interest rates rising, the perception is that Westpac will struggle more than its rivals because its business is more dependent on consumer banking than the others.
However, Morgans noted the bank will benefit from an increase in net interest margin (NIM), which is the difference between deposit and loan interest rates.
Its advisors recommend Westpac as a buy.
"Compared to previous forecasts, we downgrade FY22F and upgrade FY23-24F cash EPS, as a result of assuming greater NIM expansion, higher costs, and greater ramp-up in expensing for expected credit losses, partly offset by higher shares on issue," a memo read.
"Notable differences to consensus include higher NIM uplift and lower expected credit loss expensing, resulting in a higher dividend forecast."
Power prices aren't getting any lower
AGL Energy Limited (ASX: AGL), as Australia's largest carbon emitter, has suffered from a highly public tussle over its future this year.
The company originally proposed to split out its worst-emitting business. But Atlassian Corp (NASDAQ: TEAM) co-founder and climate activist Mike Cannon-Brookes bought a substantial number of AGL shares to stop the move.
Now he has installed a number of "independent" board members to bring about change without splitting the business.
Despite all the turbulence, investors might be surprised to know the AGL share price has actually risen 4.9% year to date. It has cooled off about 22% since August though.
Morgans investment advisor Jabin Hallihan reckons the company's "fixed fuel costs" have it positioned favourably for the current environment.
"Electricity prices remain high across all states," Hallihan told The Bull.
"It's also delivering positive near term earnings. We see upside from October 20 to our 12-month price target of $8.81. We have an add rating."
AGL shares closed Monday at $6.56 apiece.
To top it off, Hallihan noted that the power-generating business is already making progress on its carbon emissions.
"The company is exiting coal-fired generation by 2035, accelerating the closure of the Loy Yang A power station by 10 years."
